Form of Registration Rights Agreement dated August 1, 2005


    EXHIBIT
      10.1

     

    


     

    REGISTRATION
      RIGHTS AGREEMENT

     

    THIS
      AGREEMENT (the “Agreement”)
      is
      made and entered into effective as of the 1st
      day of
      August, 2005, by and between Petro Resources Corporation, a Delaware corporation
      (the “Company”),
      and
      the subscribers of the Company’s securities pursuant to the Confidential Private
      Placement Memorandum dated August 1, 2005 (the “Holder”).

     

    For
      good
      and valuable consideration, the receipt and adequacy of which are hereby
      acknowledged, the Company and Holder hereby agree as follows.

     

    
      	1.	
              Definitions.

            


    

     

    As
      used
      in this Agreement, the following terms, not previously defined, will have the
      meanings as set forth herein:

     

    1.1 “Commission”
means
      the United States Securities and Exchange Commission, and any successor thereto.
      

     

    1.2 “Common
      Stock”
means
      the Company’s Common Stock, $.01 par value.

     

    1.3 “Exchange
      Act”
means
      the Securities Exchange Act of 1934, as amended, and the rules and regulations
      promulgated from time to time thereunder. 

     

    1.4 “Person”
means
      an individual, partnership, limited partnership, corporation, business trust,
      limited liability company, an association, joint stock company, a trust,
      unincorporated organization, joint venture or other entity of whatever nature.
      

     

    1.5 “Registrable
      Common”
means
      any shares of Common Stock issued to the Holder or issuable to the Holder upon
      the exercise of the warrants issued pursuant to a Subscription Agreement between
      the Company and the Holder, including any shares of Common Stock issued as
      a
      dividend, stock split, reclassification, recapitalization or other distribution
      with respect to or in exchange for replacement of the preceding; provided,
      however,
      that
      Registrable Common will not include any shares, the sale of which has been
      registered pursuant to the Securities Act or which have been or could be sold
      to
      the public pursuant to Rule 144 promulgated by the Commission under the
      Securities Act without restriction under the volume limitations of Rule
      144.

     

    1.6 “Register,”
      “registered”
and
      “registration”
refer
      to a registration effected by preparing and filing a registration statement
      in
      compliance with the Securities Act and the declaration or ordering of the
      effectiveness of such Registration Statement.

     

    1.7 “Securities
      Act”
means
      the Securities Act of 1933, as amended, and the rules and regulations
      promulgated from time to time thereunder.

     

    1.8 “Subscription
      Agreement”
means
      the Subscription Agreement and Letter of Investment Intent executed by the
      Holder for the purchase of shares of Common Stock and warrants to purchase
      Common Stock in the private placement offering (the “Offering”) pursuant to the
      Company’s Private Placement Memorandum, dated August 1, 2005.

    


    
      	2.	
              Registration
                Rights.

            


    

     

    2.1. Subject
      to the limitations and requirements set forth in this Section 2, the Company
      will use commercially reasonable efforts to prepare and file, by March 15,
      2006,
      a registration statement under the Securities Act, on the appropriate form
      covering resale of the Registrable Common, and will use commercially reasonable
      efforts to cause such registration statement to become effective as soon as
      is
      practicable after such filing. 

     

    
      
         

      

      
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    2.2. The
      Company will not be obligated to take any action to effect any such
      registration, qualification or compliance pursuant to this Section in any
      particular jurisdiction in which the Company would be required to execute a
      general consent to service of process in effecting such registration,
      qualification or compliance, unless the Company already is subject to service
      in
      such jurisdiction and except as may be required by the Securities
      Act.

     

    2.3. If
      the
      Company furnishes to such Holder(s) a certificate signed by the Chief Executive
      Officer of the Company stating that in the good faith judgment of the Board
      of
      Directors of the Company it would be seriously detrimental to the Company and
      its stockholders for such registration statement to be filed at such time,
      then
      the Company will have the right to defer such filing for a period ending not
      later than thirty (30) days from the latest filing date of such offering as
      required herein. 

     

    3. Registration
      Procedures.
      When
      the Company is required by the terms of this Agreement to effect the
      registration of Registrable Common under the Securities Act, the Company
      will:

     

    3.1. Filing.
      Prepare
      and file with the Commission a registration statement with respect to such
      securities, and use commercially reasonable efforts to cause such registration
      statement to become and remain effective for such period as may be reasonably
      necessary to effect the sale of such securities, but not to exceed the lesser
      of
      (i) one year following the final closing of the offering or (ii) until the
      distribution described in the registration statement has been
      completed.

     

    3.2. Period
      of Effectiveness.
      Prepare
      and file with the Commission such amendments to such registration statement
      and
      supplements to the prospectus contained therein as may be necessary to keep
      such
      registration statement effective for the period described in Section
      3.1.

     

    3.3. Copies.
      Furnish
      to the Holders participating in such registration and, if applicable, to the
      underwriters of the securities being registered such reasonable number of copies
      of the registration statement, preliminary prospectus, final prospectus and
      such
      other documents as such underwriters may reasonably request in order to
      facilitate the public offering of such securities.

     

    3.4. Blue
      Sky.
      Use its
      commercially reasonable efforts to register or qualify the securities covered
      by
      such registration statement under such state securities or blue sky laws of
      such
      jurisdictions as such participating Holder may reasonably request in writing
      within twenty (20) days following the original filing of such registration
      statement, except that the Company will not for any purpose be required to
      execute a general consent to service of process or to qualify to do business
      as
      a foreign corporation or subject itself to taxation in any jurisdiction wherein
      it is not so qualified or taxed.

     

    3.5. Notification.
      Notify
      the Holders participating in such registration, promptly after it receives
      notice thereof, of the time when such registration statement has become
      effective or a supplement to any prospectus forming a part of such registration
      statement has been filed.

     

    3.6. Amendment
      Notice.
      Notify
      the Holders participating in such registration promptly of any request by the
      Commission for the amending or supplementing of such registration statement
      or
      prospectus or for additional information.

     

    3.7. Update.
      Prepare
      and promptly file with the Commission and promptly notify the Holders
      participating in such registration of the filing of such amendment or supplement
      to such registration statement or prospectus as may be necessary to correct
      any
      statements or omissions if, at the time when a prospectus relating to such
      securities is required to be delivered under the Securities Act, any event
      has
      occurred as the result of which any such prospectus or any other prospectus
      as
      then in effect would include an untrue statement of a material fact or omit
      to
      state any material fact necessary to make the statements therein, in light
      of
      the circumstances in which they were made, not misleading.

     

    
      
         

      

      
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    3.8. Stop
      Orders.
      Advise
      the Holders participating in such registration, promptly after it receives
      notice or obtains knowledge thereof, of the issuance of any stop order by the
      Commission suspending the effectiveness of such registration statement or the
      initiation or threatening of any proceeding for that purpose and promptly use
      its best efforts to prevent the issuance of any stop order or to obtain its
      withdrawal if such stop order should be issued.

     

    4. Expenses.
      With
      respect to the registration requested pursuant to Section 2 hereof (except
      as
      otherwise provided in such Section) and with respect to each inclusion of
      Registrable Common in a registration statement pursuant to Section 2 hereof
      (except as otherwise provided in such Section), the Company will bear the
      following fees, costs and expenses: all registration, filing and NASD fees,
      printing expenses, fees and disbursements of counsel and accountants for the
      Company, all internal Company expenses, all legal fees and disbursements and
      other expenses of complying with state securities or blue sky laws of any
      jurisdictions in which the securities to be offered are to be registered or
      qualified, and the premiums and other costs of policies of insurance against
      liability (if any) arising out of such public offering. Fees and disbursements
      of counsel and accountants for the selling security Holders, underwriting
      discounts and commissions and transfer taxes relating to the shares included
      in
      the offering by the selling security Holders, and any other expenses incurred
      by
      the selling security Holders not expressly included above, will be borne by
      the
      selling security Holders.

     

    
      	5.	
              Indemnification.
                

            


    

     

    5.1. Indemnification
      by Company.
      To the
      fullest extent permitted by law, the Company will indemnify and hold harmless
      each Holder which has Registrable Common included in a registration statement
      pursuant to the provisions hereof, its directors and officers, and any
      underwriter (as defined in the Securities Act) for such Holder and each Person,
      if any, who controls such Holder or such underwriter within the meaning of
      the
      Securities Act, from and against, and will reimburse such Holder and each such
      underwriter and controlling Person with respect to, any and all loss, damage
      and
      liability (collectively, “Losses”) to which such Holder or any such underwriter
      or controlling Person may become subject under the Securities Act, state
      securities laws or otherwise, and the Company will pay to each such Holder,
      underwriter or controlling person any legal or other costs or expenses
      reasonably incurred by such person in connection with investigating or defending
      any such Loss, insofar as such Losses arise out of or are based upon any untrue
      statement or alleged untrue statement of any material fact contained in such
      registration statement, any prospectus contained therein or any amendment or
      supplement thereto, or arise out of or are based upon the omission or alleged
      omission to state therein a material fact required to be stated therein or
      necessary to make the statements therein, in light of the circumstances in
      which
      they were made, not misleading; provided, however, that the Company will not
      be
      liable in any such case to the extent that any such Loss arises out of or is
      based upon an untrue statement or alleged untrue statement or omission or
      alleged omission so made in conformity with information furnished by such
      Holder, such underwriter or such controlling Person in writing specifically
      for
      use in the preparation thereof; provided, however, that the indemnity agreement
      in this Section 5.1 will not apply to amounts paid in settlement of any such
      Loss if such settlement is effected without the consent of the Company, which
      consent will not be unreasonably withheld, and that the foregoing indemnity
      obligation with respect to any preliminary prospectus or final prospectus (if
      such final prospectus has been amended or supplemented and such amendments
      or
      supplements have been furnished to such Holder prior to the written confirmation
      of the sale involved) will not inure to the benefit of any Holder on account
      of
      any Loss whatsoever arising from the sale of any Registrable Common by such
      Holder to any person if (A) a copy of the final prospectus (as amended or
      supplemented if such amendments or supplements have been furnished to such
      Holder prior to the written confirmation of the sale involved) has not been
      sent
      or given by or on behalf of such Holder to such person, if required by law,
      with
      or prior to the written confirmation of the sale involved, and (B) the untrue
      statement or alleged untrue statement or omission or alleged omission of a
      material fact contained in such preliminary prospectus or final prospectus
      from
      which such Loss arose was corrected in the final prospectus (as amended or
      supplemented if such amendments or supplements thereto have been furnished
      as
      aforesaid).

     

    
      
         

      

      
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    5.2. Indemnification
      by Holder.
      Each
      Holder which has Registrable Common included in a registration statement
      pursuant to the provisions hereof will severally, but not jointly, indemnify
      and
      hold harmless the Company, its directors and officers, each Person, if any,
      who
      controls the Company within the meaning of the Securities Act, any other Holder
      selling securities pursuant to such registration statement, any controlling
      Person of any such selling Holder, any underwriter and any controlling Person
      of
      any such underwriter (each, an “Indemnitee”) from and against, and will
      reimburse any Indemnitee with respect to, any and all Losses to which such
      Indemnitee may become subject under the Securities Act, state securities laws
      or
      otherwise, and such Holder will pay to each Indemnitee, any legal or other
      costs
      or expenses reasonably incurred by such person in connection with investigating
      or defending any such Loss, insofar as such Losses are caused by any untrue
      or
      alleged untrue statement of any material fact contained in such registration
      statement, any prospectus contained therein or any amendment or supplement
      thereto, or arise out of or are based upon the omission or the alleged omission
      to state therein a material fact required to be stated therein or necessary
      to
      make the statements therein, in light of the circumstances in which they were
      made, not misleading, in each case to the extent, but only to the extent, that
      such untrue statement or alleged untrue statement or omission or alleged
      omission was so made in reliance upon and in conformity with written information
      furnished by such Holder specifically for use in the preparation thereof;
      provided, however, that the indemnity agreement in this Section 5.2 will not
      apply to amounts paid in settlement of any such Loss if such settlement is
      effected without, and that hat the foregoing indemnity obligation with respect
      to any preliminary prospectus or final prospectus (if such final prospectus
      has
      been amended or supplemented and such amendments or supplements have been
      furnished to such Indemnitee prior to the written confirmation of the sale
      involved) will not inure to the benefit of any Indemnitee on account of any
      Loss
      whatsoever arising from the sale of any Registrable Common by the Holder to
      any
      person if (A) a copy of the final prospectus (as amended or supplemented if
      such
      amendments or supplements have been furnished to such Indemnitee prior to the
      written confirmation of the sale involved) has not been sent or given by or
      on
      behalf of such Indemnitee to such person, if required by law, with or prior
      to
      the written confirmation of the sale involved, and (B) the untrue statement
      or
      alleged untrue statement or omission or alleged omission of a material fact
      contained in such preliminary prospectus or final prospectus from which such
      Loss arose was corrected in the final prospectus (as amended or supplemented
      if
      such amendments or supplements thereto have been furnished as aforesaid);
      provided further, however, that the obligations of each Holder under this
      Section 5.2 will be limited to an amount equal to the net proceeds to such
      Holder from the sale of Registrable Common as contemplated herein, unless such
      claim, loss, damage, liability or action resulted from such Holder’s fraudulent
      misconduct.

     

    5.3. Indemnification
      Procedures.
      Promptly after receipt by a party entitled to indemnification pursuant to this
      Section (each, an “Indemnified Party”) of notice of the commencement of any
      action involving the subject matter of the foregoing indemnity provisions such
      Indemnified Party will, if a claim is to be made against the party obligated
      to
      provide indemnification pursuant to this section (each, an “Indemnifying
      Party”), promptly notify the Indemnifying Party of the commencement thereof; but
      the omission to provide such notice will not relieve the Indemnifying Party
      from
      any liability hereunder, except to the extent that the delay in giving, or
      failing to give, such notice has a material adverse effect upon the ability
      of
      the Indemnifying Party to defend against the claim. In case such action is
      brought against an Indemnified Party, the Indemnifying Party will have the
      right
      to participate in and, at the Indemnifying Party’s option, to assume the defense
      thereof, singly or jointly with any other Indemnifying Party similarly notified,
      with counsel or reasonably satisfactory to the Indemnified Party; provided,
      however, that if the defendants in any action include both the Indemnified
      Party
      and the Indemnifying Party and the Indemnified Party reasonably concludes that
      there may be legal defenses available to any Indemnified Parties that are
      different from or additional to those available to the Indemnifying Party,
      or if
      there is a conflict of interest which would prevent counsel for the Indemnifying
      Party from also representing the Indemnified Party, the Indemnified Party will
      have the right to select counsel to participate in the defense of such action
      on
      behalf of such Indemnified Party at the expense of the Indemnifying Party;
      provided further, however, that the Indemnifying Party will be responsible
      for
      the expenses of only one such special counsel (and one local counsel if
      necessary for jurisdictional purposes) selected jointly by the Indemnified
      Parties if there is more than one Indemnified Party. After notice from an
      Indemnifying Party to any Indemnified Party of such Indemnifying Party’s
      election to assume the defense or the action, the Indemnifying Party will not
      be
      liable to such Indemnified Party pursuant to this Section 5 for any legal or
      other expense subsequently incurred by such Indemnified Party in connection
      with
      the defense thereof, unless (i) the Indemnified Party has employed counsel
      in
      accordance with the proviso of the preceding sentence, or (ii) the Indemnifying
      Party has not employed counsel satisfactory to the Indemnified Party to
      represent the Indemnified Party within a reasonable time after the notice of
      the
      commencement of the action, or (iii) the Indemnifying Party has authorized
      the
      employment of counsel for the Indemnified Party at the expense of the
      Indemnifying Party.

     

    
      
         

      

      
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    6. Cooperation.
      Any
      Holder whose Registrable Common are to be included in a Registration Statement
      either filed pursuant to a demand or as part of a Company registration agrees
      to
      cooperate with all reasonable requests by the Company necessary to effectuate
      the purposes of this Agreement, including by timely providing the Company with
      all information necessary to prepare and file a registration
      statement.

     

    
      	7.	
              Miscellaneous.

            


    

     

    7.1. Waivers,
      Amendments and Approvals.
      In each
      case in which the approval of the Holder is required by the terms of this
      Agreement, such requirement will be satisfied by a vote or the written action
      of
      Holders of at least a majority of the Registrable Common held by all the
      Holders, unless a higher percentage is specifically required by the terms of
      this Agreement. Any term or provision of this Agreement requiring performance
      by
      or binding upon the Company or the Holders may be amended, and the observance
      of
      any term of this Agreement may be waived (either generally or in a particular
      instance and either retroactively or prospectively), only by a writing signed
      by
      the Company and the Holders of at least a majority of the Registrable Common
      held by all the Holders. Any amendment or waiver effected in accordance with
      this Section will be binding upon all of the Holders (including permitted
      assigns pursuant to Section 7.4 hereof). The waiver by a party of any breach
      hereof or default in payment of any amount due hereunder or default in the
      performance hereof will not be deemed to constitute a waiver of any other
      default or succeeding breach or default. Written notice of any such waiver,
      consent or agreement of amendment, modification or supplement will be given
      to
      the record Holder of Registrable Common who did not give written consent
      thereto.

     

    7.2. Notices.
      All
      notices, requests, consents and other communications required or permitted
      hereunder will be in writing and will be delivered either by (i) personal
      delivery, (ii) registered or certified airmail, postage prepaid or (iii)
      facsimile, as follows:

     

    7.2.1. to
      a
      Holder, addressed to such Holder at the address(es) set forth on Schedule
      A.

     

    7.2.2. to
      the
      Company, to:

     

    Petro
      Resources Corporation

    5100
      Westheimer, Suite 200

    Houston,
      TX 77056

    Attention:
      Wayne P. Hall

    Fax:
      (713) 968-9283

     

    and
      such
      notices and other communications will for all purposes of this Agreement be
      treated as being effective or having been given if delivered personally, or,
      if
      sent by mail, when received. Any party may change its address for such
      communications by giving notice thereof to the other parties in conformity
      with
      this Section.

     

    7.3. Entire
      Agreement.
      This
      Agreement, the schedules hereto, the documents referenced herein and the
      exhibits thereto, constitute the entire understanding and agreement of the
      parties hereto with respect to the subject matter hereof and thereof and
      supersede all prior and contemporaneous agreements or understandings,
      inducements or conditions, express or implied, written or oral, between the
      parties with respect hereto and thereto. The express terms hereof control and
      supersede any course of performance or usage of the trade inconsistent with
      any
      of the terms hereof.

     

    7.4. Other
      Remedies.
      Any and
      all remedies herein expressly conferred upon a party will be deemed cumulative
      with, and not exclusive of, any other remedy conferred hereby or by law on
      such
      party, and the exercise of any one remedy will not preclude the exercise of
      any
      other.

     

    7.5. Delays
      or Omissions.
      Except
      as expressly provided herein, no delay or omission to exercise any right, power
      or remedy accruing to any party under this Agreement will impair any such right,
      power or remedy of such party nor will it be construed to be a waiver of any
      such breach or default, or an acquiescence thereto, or of a similar breach
      of
      default thereafter occurring; nor will any waiver of any single breach or
      default be deemed a waiver of any other breach or default theretofore or
      thereafter occurring. Any waiver, permit, consent or approval of any kind or
      character on the part of any party hereto of any breach or default under the
      Agreement, or any waiver on the part of any party of any provisions or
      conditions of this Agreement must be in writing and will be effective only
      to
      the extent specifically set forth in such writing. 

     

    
      
         

      

      
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    7.6. Governing
      Law.
      This
      Agreement will be governed by and construed under the laws of the State of
      Texas, without regard to the conflict of laws principles thereof.

     

    7.7. Counterparts.
      This
      Agreement may be executed concurrently (including facsimile signatures) in
      two
      or more counterparts, each of which will be deemed an original, but all of
      which
      together will constitute one and the same instrument.

     

    7.8. Severability.
      Should
      any one or more of the provisions of this Agreement or of any agreement entered
      into pursuant to this Agreement be determined to be illegal or unenforceable,
      all other provisions of this Agreement and of each other agreement entered
      into
      pursuant to this Agreement, will be given effect separately from the provision
      or provisions determined to be illegal or unenforceable and will not be affected
      thereby.

     

    


     

    IN
      WITNESS WHEREOF, this Agreement is hereby executed as of the date first written
      above.

     

    PETRO
      RESOURCES CORPORATION

    


    By: /s/
      Wayne P. Hall    

          Wayne
      P. Hall, Chief Executive Officer

     

     

    
      
         

      

      
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    Schedule
      A

    to
      Registration Rights Agreement

    


    


    


    
      	
              Name
                and Address of Investor

            	
              Number
                of 

              Shares
                Purchased

            	
              Number
                of 

              Warrant
                Shares

            
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 


    

    
 

     

     

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